Major depressive disorder (MDD) is highly prevalent among substance users, which has significant clinical and public health implications, including poor substance use treatment outcomes. Rates of substance use and depression have been shown to disproportionately affect ethnic minorities in inner-city areas; yet unfortunately, few interventions targeting depression have been developed to meet the specific needs of depressed, minority substance users living in the inner-city. One approach that has been suggested to be useful in this context is behavioral activation (BA), which treats depression by increasing individuals' engagement in pleasant events, and thus increasing positive reinforcement (Jacobson et al., 1996; Lejuez et al., 2001). Daughters and colleagues (2008) have adapted BA to meet the specific needs of inner-city, African American substance users with depression, and in a preliminary pilot study for this treatment [Life Enhancement Treatment for Substance Use (LET'S ACT)], LET'S ACT was associated with a significant reduction in self-reported depressive symptoms and a significant increase in enjoyment and reward value of activities. While preliminary findings for LET'S ACT prove promising, several extensions of the previous study are necessary, including 1) assessment of post-treatment substance use relapse 2) utilization of a contact time-matched control treatment, and 3) the use of a larger sample size to allow for more complex analyses of the mechanisms underlying treatment outcomes. Thus, the current study will address these limitations by comparing LETS ACT to Supportive Counseling (SC) among a sample of 196 low-income substance users with MDD receiving residential substance abuse treatment in inner-city Washington, DC. Depression is prevalent in substance using populations and is associated with poor substance use treatment outcomes, yet few interventions have been developed to treat depression among inner-city, minority illicit drug users. This proposal aims to further develop a behavioral activation treatment for depression specifically for inner-city illicit drug users in residential substance use treatment and examine its effect on substance use treatment dropout and post-treatment relapse.